Completing Form SBUL27 for Deemed Sale and Purchase of Hong Kong Stocks

Form SBUL27 Deemed Sale and Purchase of Hong Kong Stocks

The Form SBUL27 Deemed Sale and Purchase of Hong Kong Stocks is a statutory form used to report a transaction that is treated as a sale and purchase of Hong Kong stocks for stamp duty purposes, even though no actual transfer of ownership occurs. This form is filed with the Inland Revenue Department's Stamp Duty Office (IRSD) to account for the stamp duty payable on such deemed transactions. The form serves as both a bought note and a sold note, documenting the particulars of the transaction for the Stamp Duty Office.

SBUL27 Form Hong Kong

The SBUL27 form is one of several forms under the Stamp Duty Ordinance (Cap. 117) used to report stock transactions in Hong Kong. It is specifically designed for situations where a transaction is "deemed" to be a sale and purchase of Hong Kong stocks under section 19 of the Ordinance. The form is available on the Inland Revenue Department's forms index and must be completed in duplicate - one copy for the buyer and one for the seller - or as a single combined form where both parties are identified.

The form requires the following particulars: - The date of the deemed transaction - The names and addresses of the buyer and seller - The number and class of shares transferred - The consideration or value of the shares - The amount of stamp duty payable - The signature of the person lodging the form or their authorised representative

Deemed Sale and Purchase Stocks Hong Kong

A deemed sale and purchase of Hong Kong stocks occurs when a transaction is treated as a sale and purchase for stamp duty purposes, even though no physical transfer of share certificates or change in legal ownership takes place. Common scenarios include: - A transfer of shares between associated companies where the beneficial ownership does not change - A transfer of shares under a scheme of arrangement or amalgamation - A transfer of shares that is part of a larger transaction structured to avoid stamp duty - A transfer of shares where the consideration is not in cash, such as an exchange of shares

Under section 19 of the Stamp Duty Ordinance, the Commissioner of Stamp Duties may deem a transaction to be a sale and purchase if it appears to be a transfer of beneficial ownership of Hong Kong stocks. The deemed transaction is then subject to stamp duty at the rate of 0.13% of the consideration or value of the shares (0.26% total when both buyer and seller are liable).

Hong Kong Stock Transaction Form SBUL27

When a stock transaction is deemed to be a sale and purchase, the parties must file Form SBUL27 with the Stamp Duty Office. The form acts as both a bought note and a sold note, documenting the transaction for stamp duty purposes. The form must include: - A certified true copy of any agreement or document evidencing the transaction - The particulars of the transaction, including the date, parties, and consideration - The calculation of stamp duty payable - Any supporting documents, such as board resolutions or agreements

The Stamp Duty Office may request additional information to verify the nature of the transaction. If the office determines that the transaction is indeed a deemed sale and purchase, it will issue a stamp duty assessment and require payment of the duty.

SBUL27 Filing Requirements

The filing requirements for Form SBUL27 are as follows: - The form must be filed within 2 days of the deemed transaction date (or within such longer period as the Commissioner may allow) - The form must be completed in duplicate, with one copy for the buyer and one for the seller - The form must be signed by the person lodging it or their authorised representative - A certified true copy of any supporting documents must be attached - The stamp duty must be paid at the time of filing

The form can be filed in person at the Stamp Duty Office or by post. Electronic filing is not currently available for this form. The Stamp Duty Office will stamp the form and return one copy to the filer as evidence of compliance.

Penalty for Late Filing

Late filing of Form SBUL27 attracts penalties under the Stamp Duty Ordinance. The penalty is calculated as follows: - If the form is filed within 1 month of the deadline: a penalty of HK$500 or 5% of the duty, whichever is higher - If the form is filed more than 1 month but within 2 months: a penalty of HK$1,000 or 10% of the duty, whichever is higher - If the form is filed more than 2 months late: a penalty of HK$2,000 or 20% of the duty, whichever is higher

In addition to the penalty, interest may be charged on the unpaid duty at the rate prescribed by the Inland Revenue Department. The Stamp Duty Office may also prosecute for non-compliance, which can result in a fine of up to HK$10,000 and imprisonment for up to 6 months.

Filing Process with the Stamp Duty Office

The filing process for Form SBUL27 involves the following steps: 1. Determine whether the transaction is a deemed sale and purchase under section 19 of the Stamp Duty Ordinance 2. Complete Form SBUL27 with the required particulars 3. Attach a certified true copy of any supporting documents 4. Calculate the stamp duty payable (0.13% for each party, 0.26% total) 5. File the form with the Stamp Duty Office within 2 days of the transaction 6. Pay the stamp duty at the time of filing 7. Receive a stamped copy of the form as evidence of compliance

The Stamp Duty Office may request additional information or documents to verify the transaction. If the office determines that the transaction is not a deemed sale and purchase, it will return the form without assessment.

Stamp Duty on Deemed Transactions

Stamp duty on deemed sale and purchase of Hong Kong stocks is calculated at the same rate as actual transactions: 0.13% of the consideration or value of the shares for each party (buyer and seller), making a total of 0.26%. The duty is payable by both parties unless the transaction is exempt or the parties agree otherwise.

The consideration is the value of the shares at the date of the deemed transaction. If the consideration is not in cash, the Stamp Duty Office will determine the value based on the market value of the shares or the consideration given.

Exemptions from stamp duty on deemed transactions include: - Transfers between associated companies (under section 45 of the Stamp Duty Ordinance) - Transfers under a scheme of arrangement approved by the court - Transfers under a statutory amalgamation - Transfers of shares in a company that is being wound up

Record Keeping and Compliance

After filing Form SBUL27, the parties must retain a copy of the stamped form and any supporting documents for at least 7 years. The Inland Revenue Department may request these records during an audit or investigation.

Failure to maintain proper records can result in penalties under the Stamp Duty Ordinance. The Stamp Duty Office may also impose additional assessments if it discovers that a deemed transaction was not reported.

Contacting the Stamp Duty Office

For questions about Form SBUL27 or deemed sale and purchase transactions, contact the Stamp Duty Office at: - Address: 15th Floor, Inland Revenue Centre, 5 Concorde Road, Kai Tak, Kowloon, Hong Kong - Telephone: (852) 2594 3200 - Email: [email protected]

The Stamp Duty Office also provides guidance notes on its website, which explain the filing requirements and calculation of stamp duty for deemed transactions.